2022-06-24 sec-litreleases litigation_release 65 KB 2,183 chars

SEC v. StraightPath Venture Partners LLC; StraightPath Management LLC; Brian K. Martinsen; Michael A. Castillero; Francine A. Lanaia; and Eric D. Lachow, No. LR-25429, Southern District of New York (June 24, 2022) — Press Release

raw: StraightPath Venture Partners LLC, StraightPath Management LLC, Brian K. Martinsen, Michael A. Castillero, Francine A. Lanaia, and Eric D. Lachow

StraightPath Venture Partners LLC, StraightPath Management LLC, Brian K. Martinsen, Michael A. Castillero, Francine A. Lanaia, and Eric D. Lachow, No. 1:22-cv-03897 (S.D.N.Y. June 24, 2022)

Caption
Securities and Exchange Commission v. Straightpath Venture Partners, LLC
Source JSON
summary

The SEC obtained a preliminary injunction and appointed a receiver against StraightPath Venture Partners and its principals for a fraudulent $410 million pre-IPO stock offering.

paragraph

The SEC charged StraightPath Venture Partners LLC, its management entities, and several individuals with conducting a fraudulent $410 million pre-IPO stock offering. The defendants allegedly sold shares they did not own, pocketed undisclosed fees, and commingled funds in a Ponzi scheme-like manner. The court ordered key defendants to pay over $15 million into a receivership estate and maintained a freeze on their real estate holdings.

narrative

The SEC has obtained a preliminary injunction and appointed a receiver against StraightPath Venture Partners LLC, StraightPath Management LLC, and principals Brian K. Martinsen, Michael A. Castillero, Francine A. Lanaia, and Eric D. Lachow. The defendants are accused of conducting a fraudulent $410 million pre-IPO stock offering by selling shares they did not own, pocketing undisclosed fees, and commingling investor funds to facilitate Ponzi scheme-like payments. The litigation involves charges of violating various provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940. As part of the court's order, Martinsen, Castillero, and Lanaia were required to pay more than $15 million into the receivership estate. Additionally, the court continued a freeze over the defendants' real estate holdings. The preliminary injunction will remain in effect until the conclusion of the litigation.

Enriched metadata

Scheme
pre-ipo-fraud (100%)
Court
Southern District of New York
Case No.
1:22-cv-03897
Victim loss
$15,000,000
Entity
StraightPath Venture Partners LLC
Classified pre-ipo-fraud(confidence 100%). EDGAR detection: forms S-1/Form D/1-A· recall 72% / precision 8%. detection rule →
Statutes
Sections 5(a), 5(c) and 17(a) of the Securities ActSections 5(a), 5(c) and 17(a) of the Securities ActSections 5(a), 5(c) and 17(a) of the Securities ActSections 10(b) and 15(a) of the Securities Exchange ActSections 10(b) and 15(a) of the Securities Exchange ActSections 206(1), 206(2), 206(3), and 206(4) of the Investment Advisers ActSections 206(1), 206(2), 206(3), and 206(4) of the Investment Advisers ActSections 206(1), 206(2), 206(3), and 206(4) of the Investment Advisers ActSections 206(1), 206(2), 206(3), and 206(4) of the Investment Advisers ActRule 10b-5
Parties
Securities and Exchange CommissionStraightpath Venture Partners, LLCOtterbourg P.C.Melanie L. CyganowskiStretto, Inc.Brian K. MartinsenStraightpath Management, LLCJohn T. SeftonFrancine A. LanaiaMichael A. CastilleroStout Risius Ross,LLCEric D. Lachow
Keywords
straightpathllcstraightpath ventureventure partnersstraightpath managementbrian martinsenmartinsen michaelmichael castillerocastillero francinefrancine lanaialanaia ericeric lachowpartnerspreliminary injunctionsecurities exchange

Extracted insights

Dollar amounts 2
  • $410.00M $410 million $100M–$1B
  • $15.00M $15 million $10M–$100M
Entities 4
  • person investor funds
  • agency Securities and Exchange Commission
  • person undisclosed fees
  • court u.s. district court for the southern district of new york
Triples 9
  • Securities And Exchange Commission obtained preliminary injunction, appointment of a receiver, and continued partial asset freeze order against StraightPath Venture Partners LLC, StraightPath Management LLC, Brian K. Martinsen, Michael a. Castillero, Francine a. Lanaia, and Eric D. Lachow
  • U.S. District Court For The Southern District Of New York appointed receiver over StraightPath Venture Partners LLC, StraightPath Management LLC, and the SP Ventures Partners Funds Defendants managed and advised
  • Mr. Martinsen, Mr. Castillero, and Ms. Lanaia required to pay more than $15 million into the receivership estate
  • Honorable Lewis a. Kaplan entered preliminary injunction and continued partial asset freeze order on June 14, 2022
  • SEC charged Defendants on May 13, 2022
  • Defendants conducted fraudulent $410 million offering
  • Defendants sold pre-Initial Public Offering shares they did not own
  • Defendants pocketed undisclosed fees
  • Defendants commingled investor funds
View original SEC litigation releasesec.gov
Extracted body text (2,183c) 
SEC Obtains Preliminary Injunction and Appointment of a Receiver in Pre-Ipo Stock Fraud by Unregistered Broker-Dealer Litigation Release No. 25429 / June 24, 2022 Securities and Exchange Commission v. StraightPath Venture Partners LLC, StraightPath Management LLC, Brian K. Martinsen, Michael A. Castillero, Francine A. Lanaia, and Eric D. Lachow, No. 1:22-cv-03897 (S.D.N.Y. filed May 13, 2022) The Securities and Exchange Commission has obtained a preliminary injunction, appointment of a receiver, and continued partial asset freeze order against StraightPath Venture Partners LLC, StraightPath Management LLC, Brian K. Martinsen, Michael A. Castillero, Francine A. Lanaia, and Eric D. Lachow (collectively, "Defendants"). The Court appointed a receiver over StraightPath Venture Partners LLC, StraightPath Management LLC, and the SP Ventures Partners Funds Defendants managed and advised. The Court also required that Mr. Martinsen, Mr. Castillero, and Ms. Lanaia, who were subject to the initial temporary asset freeze order, pay more than $15 million into the receivership estate and continued a freeze over their real estate holdings. The preliminary injunction and continued partial asset freeze order, entered by the Honorable Lewis A. Kaplan of the U.S. District Court for the Southern District of New York on June 14, 2022, preliminarily enjoined Defendants from violating Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1), 206(2), 206(3), and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. The court's preliminary injunctions will remain in effect until the litigation of this matter is concluded. The SEC charged Defendants on May 13, 2022. According to the complaint, Defendants conducted a fraudulent $410 million offering in violation of the securities and broker-dealer registration provisions identified above. Among other things, Defendants allegedly sold pre-Initial Public Offering (IPO) shares they did not own, pocketed undisclosed fees, and commingled investor funds, resulting in Ponzi scheme-like payments.
OCR text (2,183c · html-text · 99% conf) 
SEC Obtains Preliminary Injunction and Appointment of a Receiver in Pre-Ipo Stock Fraud by Unregistered Broker-Dealer Litigation Release No. 25429 / June 24, 2022 Securities and Exchange Commission v. StraightPath Venture Partners LLC, StraightPath Management LLC, Brian K. Martinsen, Michael A. Castillero, Francine A. Lanaia, and Eric D. Lachow, No. 1:22-cv-03897 (S.D.N.Y. filed May 13, 2022) The Securities and Exchange Commission has obtained a preliminary injunction, appointment of a receiver, and continued partial asset freeze order against StraightPath Venture Partners LLC, StraightPath Management LLC, Brian K. Martinsen, Michael A. Castillero, Francine A. Lanaia, and Eric D. Lachow (collectively, "Defendants"). The Court appointed a receiver over StraightPath Venture Partners LLC, StraightPath Management LLC, and the SP Ventures Partners Funds Defendants managed and advised. The Court also required that Mr. Martinsen, Mr. Castillero, and Ms. Lanaia, who were subject to the initial temporary asset freeze order, pay more than $15 million into the receivership estate and continued a freeze over their real estate holdings. The preliminary injunction and continued partial asset freeze order, entered by the Honorable Lewis A. Kaplan of the U.S. District Court for the Southern District of New York on June 14, 2022, preliminarily enjoined Defendants from violating Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1), 206(2), 206(3), and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. The court's preliminary injunctions will remain in effect until the litigation of this matter is concluded. The SEC charged Defendants on May 13, 2022. According to the complaint, Defendants conducted a fraudulent $410 million offering in violation of the securities and broker-dealer registration provisions identified above. Among other things, Defendants allegedly sold pre-Initial Public Offering (IPO) shares they did not own, pocketed undisclosed fees, and commingled investor funds, resulting in Ponzi scheme-like payments.

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